The equity release market is divided about the Financial Conduct Authority’s decision not to bring in a standalone qualification for lifetime mortgages.
Firms such as Old Mutual Wealth and Retirement Advantage back the standalone qualification, but trade body the Equity Release Council opposes it.
Old Mutual Wealth head of retirement policy Jon Greer says the FCA’s decision is “against the general direction of travel for retirement planning”.
He says: “While they have left the door ajar to revisit the issue in the future the situation could change rapidly where the number of people seeking retirement advice that includes using equity release outstrips the number of advisers qualified to give it.”
Greer adds that a standalone qualification would have helped more advisers meet demand.
Retirement Advantage Equity Release head of marketing Alice Watson says: “The FCA’s decision represents a missed opportunity to get more advisers qualified to offer equity release as a potential stream of income for people in or approaching retirement.”
Watson adds that there is an “increased need” for more equity release advisers.
She says: “The FCA may have decided against a standalone equity release qualification, but it is vital that it continues to work with the industry to improve the current qualification system. As more and more people turn to equity release as part of a holistic approach to retirement planning, a bigger cohort of advisers qualified to offer it to customers is essential.”
But Equity Release Council chairman Nigel Waterson calls the FCA decision “a clear win for consumers”.
He says: “Different consumers have different needs, and advisers need a comprehensive knowledge of a range of potential solutions – including those available via the wider mortgage market – to provide well-rounded advice.
“It is hugely encouraging that the FCA remains willing to consult and work constructively with the sector on a range of issues.
“Its decision to stick with the status quo on equity release qualifications does not prevent industry considering further progressive moves to join the dots between the equity release, residential mortgage, pensions and later life arenas.”